Mass-market jewellery brand PANDORA announced it will cut 397 jobs -- 218 of them in Thailand -- as it reorganises to streamline its manufacturing and boost sagging sales and profitability, particularly in key markets like the US.
The brand, which had a disappointing 2017, had acknowledged at an investor meeting early this year that its product line was repetitive and didn’t offer customers anything fresh. Chief Executive Anders Colding Friis promised change and a revamped strategy. He told investors that PANDORA would cut product development time and get new offerings faster to market. He added that the company aims to launch 800 products in 2022 as against the 400 that were brought to market last year. He also said that the growth would centre on categories such as necklaces, rings and earrings and expected these seguents to account for 50 percent of sales by 2022 as against 25 percent today.
The company said that the latest changes would focus on:
Strengthening cooperation between sales, marketing and merchandising.
Optimising support functions, including providing more standardised reporting and processes.
Ensuring scale benefits from selected regional shared service centres.
Implementing a centralised operations and supply chain structure to streamline manufacturing.
Shifting more resources to strategic priorities such as digital and e-commerce.
Friis commented, “We have made important progress on our 2022 strategy since we launched it last year, and are on the right long-term direction for PANDORA. The company has nearly doubled in size the past three years, and our ways of working have also grown rapidly and resulted in different organisational set-ups in different parts of the company.”
He added, “ The adjustments we announce today will reduce complexity and free up resources that we can add to our strategic priorities. The adjustments are also – together with our procurement program – necessary to protect our profitability. Sadly, the changes mean that good employees will lose their jobs, and we are supporting them in the best possible way.”
The organisational changes are expected to reduce annual costs with around DKK 150 million from 2019.